Inverse H&S pattern in play on daily time frame.
Looking at monthly time frame GBPUSD has done too much in to short a time i.e. seems oversold so this is likely to be the rebound
Although not shown on chart 38.2 fib level lies at approx 1.31
Entry is placed at the 1.264 which will likely occur on the next pullback following the break of the neckline
Stop loss placed below the recent low @1.2297. If price reached this point it would cancel the inverse H&S pattern.
Take profit has been set to match a risk reward ratio of 2.5 and is just below a crucial resistance level. (depending on the time it takes to reach his level it could also coincide with major TL resistance)
With conservative victory probable in the upcoming UK general election it will provide confidence to investor and businesses
Although Brexit is still a major event affecting this currency pair it is unlikely we will see any major developments over the next 4-6 months in my opinion
Also the outcomes of French and German election will impact GBP as it will weigh on the Brexit negotiations
USD weakness is expected - the nu of rate rises this year has been thrown into the air once again in addition to Trump's foreign policy not filling people with confidence for now
Looking at monthly time frame GBPUSD has done too much in to short a time i.e. seems oversold so this is likely to be the rebound
Although not shown on chart 38.2 fib level lies at approx 1.31
Entry is placed at the 1.264 which will likely occur on the next pullback following the break of the neckline
Stop loss placed below the recent low @1.2297. If price reached this point it would cancel the inverse H&S pattern.
Take profit has been set to match a risk reward ratio of 2.5 and is just below a crucial resistance level. (depending on the time it takes to reach his level it could also coincide with major TL resistance)
With conservative victory probable in the upcoming UK general election it will provide confidence to investor and businesses
Although Brexit is still a major event affecting this currency pair it is unlikely we will see any major developments over the next 4-6 months in my opinion
Also the outcomes of French and German election will impact GBP as it will weigh on the Brexit negotiations
USD weakness is expected - the nu of rate rises this year has been thrown into the air once again in addition to Trump's foreign policy not filling people with confidence for now